2/1/2013 8:35 PM ET|
Proposed law lets you peek at colleagues' paychecks
The Paycheck Fairness Act is designed to create equal compensation for men and women, but has far greater potential.
Senators Barbara Mikulski (D-Md.) and Rep. Rosa DeLauro (D-Conn.) introduced legislation last week that would not only require require employers to prove that differences in pay among workers are unrelated to gender or any other qualities unrelated to their employment, but keep companies from punishing workers who discuss salary information.
The proposed Paycheck Fairness Act was presented as an equal rights issue by Mikulski on the Senate floor Wednesday, but its passage would have implications far greater than shattering glass ceilings.
While the Paycheck Fairness Act is viewed as a logical extension of the Lilly Ledbetter Act signed into law by President Barack Obama in 2009 to combat pay discrimination, it's also an endorsement of an open pay model that levels the playing field for employees by making payroll decisions public. That would affect everyone involved, including the folks doling out the checks.
Sure, the act would let women find out if their male colleagues make more than they do, but it would also give everybody else some idea of how they're faring in the rat race. According to the Wall Street Journal, startup company SumAll took some stress off of its employees by adopting an open pay system. Namaste Solar, meanwhile, told Business Insider that the open model increases pressure on companies to justify pay raises for specific employees.
Open pay has been a subject of debate since at least the mid-1980s, when University of Texas at El Paso professor William H. Muhs noted that 60% of employers favored keeping payrolls secret. As he discovered, that secrecy tends to make employees think the pay system is unfair whether it is or not. Unfortunately, it's also the stucco that masks intrinsic flaws in the employee evaluation process.
Those flaws are exactly what troubled Mikulski and DeLauro into drafting their legislation in the first place. A 2011 study from the Institute For Women's Policy research found that women, on average, make 82% of what their male counterparts make. At the same time, nearly half are either not allowed or are strongly discouraged by their employers from discussing pay information with coworkers.
While the Paycheck Fairness Act may not bring immediate pay equality, it's a big step toward keeping the workplace honest.
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